Author Topic: Do we need a will? (married, two young kids, but minimal assets/savings)  (Read 1508 times)

PNW_FIRE

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Hi, my husband (46) and I (37) are recently getting our financial and retirement lives in order, and so we're also taking this opportunity to start thinking bigger about planning for the future and considering wills, medical directives, etc.

Considering where we're currently at, would you recommend we meet with an attorney to develop a will? I understand there are online programs that can help draft a will, but if we were to do this, we'd feel more comfortable going a more "official" route.

Our only physical asset worth much is our car ($10K value) which is in both of our names. We have $125K in savings (split between his savings account and mine), and ~$70K between us in our own retirement accounts.

If something were to happen to us, we'd want our kids to get everything. Since this is how the law would naturally work, is there a point to paying for a will to spell this out?

What would you do in our situation?

Thanks!

cchrissyy

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Re: Do we need a will? (married, two young kids, but minimal assets/savings)
« Reply #1 on: December 20, 2019, 11:26:28 AM »
Do you have life insurance?

I think you should have a will and a trust, and all the assets you have plus life insurance money should go into that trust to be used for the care of the children and eventually given to them as adults.

honeybbq

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Re: Do we need a will? (married, two young kids, but minimal assets/savings)
« Reply #2 on: December 20, 2019, 11:30:48 AM »
Do you know who you would want your kids to live with if you both suddenly died? (assuming they are minors?)

Who would be the executor of your estate?

If there is no will, sometimes (check your state laws) it has to go to probate.

I'd get it done; it's worth the money.

cupcakery

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Re: Do we need a will? (married, two young kids, but minimal assets/savings)
« Reply #3 on: December 20, 2019, 11:33:18 AM »
Do you know who you would want your kids to live with if you both suddenly died? (assuming they are minors?)

Who would be the executor of your estate?

If there is no will, sometimes (check your state laws) it has to go to probate.

I'd get it done; it's worth the money.

This.

PNW_FIRE

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Re: Do we need a will? (married, two young kids, but minimal assets/savings)
« Reply #4 on: December 20, 2019, 12:07:24 PM »
Thank you all! This is something we've been putting off but kind of knew we had to do so I appreciate you all confirming this.

We know who we would want the children to be raised by (although this person lives out of the country and is not a U.S. citizen--not sure how much that will further complicate things?).

We do have life insurance--around $400,000 total between us.

partgypsy

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Re: Do we need a will? (married, two young kids, but minimal assets/savings)
« Reply #5 on: December 20, 2019, 12:14:46 PM »
If u have a will, and it and life insurance etc filled out correctly you will not have to go through probate. If u have dependents I think it's important to think all this through including who will be guardian, and put in will. Good luck.

Zamboni

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Re: Do we need a will? (married, two young kids, but minimal assets/savings)
« Reply #6 on: December 20, 2019, 12:30:29 PM »
Yes, get a will. Besides your young kids, who are reason enough to have a will, the process of making a will is valuable to you in bringing matters to your attention that you should decide now (while alive) that you might not even think about otherwise.

Sibley

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Re: Do we need a will? (married, two young kids, but minimal assets/savings)
« Reply #7 on: December 20, 2019, 02:39:14 PM »
In the flowchart of do I need a will, if the answer to "do you have kids" is yes, then yes, you need a will.

diapasoun

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Re: Do we need a will? (married, two young kids, but minimal assets/savings)
« Reply #8 on: December 20, 2019, 02:45:38 PM »
In the flowchart of do I need a will, if the answer to "do you have kids" is yes, then yes, you need a will.

This. You have kids. Get a will.

MrThatsDifferent

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Re: Do we need a will? (married, two young kids, but minimal assets/savings)
« Reply #9 on: December 20, 2019, 04:40:53 PM »
YES YES YES!!! Not today, but yesterday, get a will! Life can be a nightmare without one when the inevitable happens earlier than anyone wants.

MrFire22

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Re: Do we need a will? (married, two young kids, but minimal assets/savings)
« Reply #10 on: December 24, 2019, 09:50:41 AM »
If you are in NY or NJ, I can handle your Will. I'm a lawyer.

KBecks

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Re: Do we need a will? (married, two young kids, but minimal assets/savings)
« Reply #11 on: December 24, 2019, 09:55:04 AM »
We still don't have a will and definitely need one.  I've just been slow.  One of the hardest things is picking someone to look after the kiddos if we both go.  A family in our area just had this happen -- mom and dad killed while on vacation out of the country, two teenage children left without parents at home.  They were a family of means and it appears that they had planning in place -- thank God. It's still a beast of a thing for a family. 

We have skated by without a will for 15 years of parenthood, but I'd suggest that you need a will, *and* you need life insurance.  Definitely life insurance.  We got life insurance on both of us when the kids were young and I would not skip it.  We did about $500k on each of us, which is less than what most people recommend.  This is what we considered, "enough to get by and  not be miserable if something should happen -- enough to pay off the house and have leftovers for the kids educations".  Life insurance people will recommend more, but we already had a strong start financially. 

If I recall correctly, Mr. Money Mustache has skipped out on life insurance, but I was not willing to be that extreme.
« Last Edit: December 24, 2019, 10:02:18 AM by KBecks »

KBecks

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Re: Do we need a will? (married, two young kids, but minimal assets/savings)
« Reply #12 on: December 24, 2019, 10:07:44 AM »
In the flowchart of do I need a will, if the answer to "do you have kids" is yes, then yes, you need a will.

You should also ask -- how crazy are my relatives? :)

robartsd

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Re: Do we need a will? (married, two young kids, but minimal assets/savings)
« Reply #13 on: December 24, 2019, 10:46:42 AM »
If there is no will, sometimes (check your state laws) it has to go to probate.
A will does not help avoid probate in my state - I don't know of any state where a will makes a difference in this regard. Assets in a trust do bypass probate and financial accounts with named beneficiaries avoid going through probate.

In my state, you probably would not need a trust to avoid probate with your current assets (total assets subject to probate less than $150k). Your assets would likely be inherited by your children, but a will isn't only about assets. Without a will the state would assign an administrator (executor) to manage your assets in probate, a guardian for your children, and a conservator to protect your children's assets until they are adults. Your will can nominate someone for each of these roles; this is the more important reason I would recommend you establish a will.

minimustache1985

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Re: Do we need a will? (married, two young kids, but minimal assets/savings)
« Reply #14 on: December 24, 2019, 11:02:36 AM »
We still don't have a will and definitely need one.  I've just been slow.  One of the hardest things is picking someone to look after the kiddos if we both go.  A family in our area just had this happen -- mom and dad killed while on vacation out of the country, two teenage children left without parents at home.  They were a family of means and it appears that they had planning in place -- thank God. It's still a beast of a thing for a family. 

We have skated by without a will for 15 years of parenthood, but I'd suggest that you need a will, *and* you need life insurance.  Definitely life insurance.  We got life insurance on both of us when the kids were young and I would not skip it.  We did about $500k on each of us, which is less than what most people recommend.  This is what we considered, "enough to get by and  not be miserable if something should happen -- enough to pay off the house and have leftovers for the kids educations".  Life insurance people will recommend more, but we already had a strong start financially. 

If I recall correctly, Mr. Money Mustache has skipped out on life insurance, but I was not willing to be that extreme.
MMM was also FI prior to having his son, so wouldnít need it then.

We got 20 year term policies a year or two after we got married, and added more through Hís work after having DS.  Like you itís not as much as typically recommended, but it would allow breathing room for the surviving spouse to grieve and not be rushed into financial changes (and double if we both went for the kids).  When the 20 year expires we should have enough assets to not need the insurance.

We need to update our will, and agree with PPs that if you have children you need one.

KBecks

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Re: Do we need a will? (married, two young kids, but minimal assets/savings)
« Reply #15 on: December 24, 2019, 11:32:19 AM »
I think if my DH and I both died, we'd want our kids to do a little better than basic survival.  I get the point that life insurance is a want, but, we definitely wanted it.

But this is very good information.
« Last Edit: December 24, 2019, 11:37:46 AM by KBecks »

GizmoTX

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Re: Do we need a will? (married, two young kids, but minimal assets/savings)
« Reply #16 on: December 24, 2019, 11:35:41 AM »
Yes, you need a will to designate guardianship for your child(ren).
Minors cannot inherit ó your will should take care of creating a trust for their inheritance at the time both parents are gone.
Your guardian & your trustee do not have to be the same person, & you likely donít want them to be.
Name successor guardians, trustees, & executors, just in case the first named cannot serve. Parents usually name each other, then others who are expected to survive them.
Provide enough funds in your wills for everyday child expenses, not part of the trust.
With minimal assets, you need term life insurance.

robartsd

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Re: Do we need a will? (married, two young kids, but minimal assets/savings)
« Reply #17 on: December 26, 2019, 09:27:25 AM »
Minors cannot inherit ó your will should take care of creating a trust for their inheritance at the time both parents are gone.
Minors can inherit, but generally are not given control of inherited assets until they are adults. A conservator with fiduciary responsibility would be appointed to manage on their behalf - so functionally similar to a trust but established by the legal system instead of you. Formally establishing the trust yourself could allow you to be a bit more specific in how the assets are used and when control is transferred to your children.